Should You Avoid CNH Global NV (ADR) (CNH)?

At the moment, there are a multitude of gauges market participants can use to analyze publicly traded companies. A pair of the most under-the-radar are hedge fund and insider trading activity. At Insider Monkey, our research analyses have shown that, historically, those who follow the top picks of the elite money managers can outpace the broader indices by a significant amount (see just how much).

Equally as necessary, optimistic insider trading activity is another way to look at the marketplace. Just as you'd expect, there are a variety of motivations for an insider to get rid of shares of his or her company, but just one, very clear reason why they would behave bullishly. Plenty of academic studies have demonstrated the useful potential of this strategy if investors know where to look (learn more here).

What does the smart money think about CNH Global NV (ADR) (NYSE:CNH)?

Heading into Q3, a total of 17 of the hedge funds we track were long in this stock, a change of -26% from the previous quarter. With hedgies' capital changing hands, there exists a select group of key hedge fund managers who were boosting their holdings substantially.

According to our 13F database, Southeastern Asset Management, managed by Mason Hawkins, holds the biggest position in CNH Global NV (ADR) (NYSE:CNH). Southeastern Asset Management has a $158.9 million position in the stock, comprising 0.8% of its 13F portfolio. On Southeastern Asset Management's heels is Mario Gabelli of GAMCO Investors, with a $86.3 million position; the fund has 0.5% of its 13F portfolio invested in the stock. Some other hedgies that are bullish include Shane Finemore's Manikay Partners, Brian Ashford-Russell and Tim Woolley's Polar Capital and D. E. Shaw's D E Shaw.

Because CNH Global NV (ADR) (NYSE:CNH) has experienced a fall in interest from the top-tier hedge fund industry, it's easy to see that there exists a select few fund managers who were dropping their full holdings in Q1. Interestingly, Joe DiMenna's ZWEIG DIMENNA PARTNERS sold off the largest stake of all the hedgies we watch, valued at an estimated $20.7 million in stock. Jim Chanos's fund, Kynikos, also sold off its stock, about $11.3 million worth. These bearish behaviors are intriguing to say the least, as total hedge fund interest was cut by 6 funds in Q1.

Insider trading activity in CNH Global NV (ADR) (NYSE:CNH)

Insider buying is most useful when the primary stock in question has seen transactions within the past six months. Over the latest 180-day time frame, CNH Global NV (ADR) (NYSE:CNH) has experienced zero unique insiders purchasing, and zero insider sales (see the details of insider trades here).

We'll also take a look at the relationship between both of these indicators in other stocks similar to CNH Global NV (ADR) (NYSE:CNH). These stocks are Manitowoc Company, Inc. (NYSE:MTW), Deere & Company (NYSE:DE), Terex Corporation (NYSE:TEX), AGCO Corporation (NYSE:AGCO), and Joy Global Inc. (NYSE:JOY). This group of stocks belong to the farm & construction machinery industry and their market caps resemble CNH's market cap.

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